Question

1. The debits to Work in Process—Roasting Department for Morning Brew Coffee Company for August, together with information concerning production, are as follows:

2. Work in process, August 1, 800 pounds, 30% completed				$2,688*
   	*Direct materials (800 X $3)	$2,400
   	Conversion (800 X 30% X $1.2)	288
   		$2,688
   Coffee beans added during August, 25,000 pounds				73,750
   Conversion costs during August				32,045
   Work in process, August 31, 1,300 pounds, 30% completed				?
   Goods finished during August, 24,500 pounds				?

1. All direct materials are placed in process at the beginning of production.

2. a. Prepare a cost of production report, presenting the following computations:

1. Direct materials and conversion The number of production units that could have been completed within a given accounting period, given the resources consumed.equivalent units of production for August.
2. Direct materials and conversion The rate used to allocate costs between completed and partially completed production.costs per equivalent unit for August.
3. Cost of goods finished during August.
4. Cost of work in process at August 31.

1. If an amount is zero, enter in "0". For the cost per equivalent unit, round your answer to two decimal places.

2. Morning Brew Coffee Company
   Cost of Production Report-Roasting Department
   For the Month Ended August 31
   Unit Information
   Units charged to production:
   Inventory in process, August 1
   Received from materials storeroom
   Total units accounted for by the Roasting Department
   Units to be assigned costs:
   		Equivalent Units
   	Whole Units	Direct Materials (1)	Conversion (1)
   Inventory in process, August 1
   Started and completed in August
   Transferred to finished goods in August
   Inventory in process, August 31
   Total units to be assigned costs
   Cost Information
   Cost per equivalent unit:
   		Direct Materials	Conversion
   Total costs for August in Roasting Department		$	$
   Total equivalent units
   Cost per equivalent unit (2)		$	$
   Costs assigned to production:
   	Direct Materials	Conversion	Total
   Inventory in process, August 1			$
   Costs incurred in August
   Total costs accounted for by the Roasting Department			$
   Costs allocated to completed and partially completed units:
   Inventory in process, August 1 balance			$
   To complete inventory in process, August 1	$	$
   Cost of completed August 1 work in process			$
   Started and completed in August
   Transferred to finished goods in August (3)			$
   Inventory in process, August 31 (4)
   Total costs assigned by the Roasting Department			$

3. Feedback

1. b. Compute and evaluate the change in cost per equivalent unit for direct materials and conversion from the previous month (July). If required, round your answers to the nearest cent.

	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit	Increase Decrease	$
Change in conversion cost per equivalent unit	Increase Decrease	$

Answer 1

Morning Brew Coffee Company
Cost of Production Report-Roasting Department
For the Month Ended August 31
Unit Information
Units charged to production:
Inventory in process, August 1			800
Received from materials storeroom			25000
Total units accounted for by the Roasting Department			25800
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials	Conversion
Inventory in process, August 1	800	0	560
Started and completed in August	23700	23700	23700
Transferred to finished goods in August	24500	23700	24260
Inventory in process, August 31	1300	1300	390
Total units to be assigned costs	25800	25000	24650
Cost Information
Costs per equivalent unit:
		Direct Materials	Conversion
Total costs for August in Roasting Department		73750	32045
Total equivalent units		25000	24650
Cost per equivalent unit		2.95	1.30
Costs charged to production:
	Direct Materials	Conversion	Total
Inventory in process, August 1			2688
Costs incurred in August			105795
Total costs accounted for by the Roasting Department			108483
Cost allocated to completed and partially completed units:
Inventory in process, August 1 balance			2688
To complete inventory in process, August 1	0	728	728
Cost of completed August 1 work in process			3416
Started and completed in August	69915	30810	100725
Transferred to finished goods in August			104141
Inventory in process, August 31	3835	507	4342
Total costs assigned by the Roasting Department			108483
2
	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit	Decrease	0.05	=3-2.95
Change in conversion cost per equivalent unit	Increase	0.10	=1.3-1.2